Examining how foreign exchange trading diffuses across the globe helps shed light on the renminbi’s development, a Bank for International Settlements working paper says.
Yin-Wong Cheung, Robert McCauley and Chang Shu focus on how trading spreads geographically, by drawing on data from the BIS’s triennial survey of foreign exchange and derivatives.
The authors find that between 2013 and 2016, the renminbi’s turnover diffused from Asia to the rest of the world, tracing an “arc” from
